How would Modi’s Urjaa Ganga benefit Varanasi?

The scheme marks the first step with the PM laying the foundation stone for the Rs 1,000 crore City Gas Distribution (CGD) network for Varanasi.Sudheer Singh | ETEnergyWorld | October 24, 2016, 11:54 IST

New Delhi: The Indian government has been talking about the country’s move towards a gas-based economy or long. That ambition for adopting clean energy will get a fillip today with Prime Minister Narendra Modi launching the much-awaited “Urjaa Ganga” scheme in his Parliamentary constituency Varanasi.

The scheme marks the first step with the PM laying the foundation stone for the Rs 1,000 crore City Gas Distribution (CGD) network for Varanasi, India’s largest fuel retailer Indian Oil Corporation (IOC) said in a statement. “The 800 Km pipeline network will be used to supply clean fuel to the end consumers in the city. The name Urja Ganga (River of Energy) aptly conveys the benefits that people of Varanasi will enjoy once the infrastructure is put in place,” the company said.

With this, Varanasi will become the first city in the government’s growth roadmap of Eastern India. The government had recently approved a 2,540 km gas pipeline including the Jagdishpur – Haldia and Bokaro – Dhamra pipelines – these will ensure smooth supply of gas in five states of Uttar Pradesh, Bihar, Jharkhand, West Bengal and Odisha. It also means cities including Varanasi, Patna, Ranchi, Jamshedpur, Kolkata, Bhubaneswar, Cuttack will have CGD system and people will have an option to switch to cleaner fuel.

The 800 km pipeline and supporting infrastructure will benefit 3.68 million population residing in the city. In the near future, LNG run steamers will be encouraged to transport goods through Ganges. This is expected to create direct and indirect employment for over 1,000 people. Once the infrastructure is laid for gas supply, over 200,000 households will get piped natural gas.

Piped natural gas will also benefit commercial and industrial establishments, as it is safer and economic as compared to other fuels. With 20 CNG stations installed, over 20,000 vehicles in Varanasi will have access to clean fuel. Natural Gas is considered to be affordable, clean and efficient. The event is significant, as the investment in clean fuel will accelerate the economy of the region without putting burden on the environment, IOC said. Investment in natural gas is practically an investment towards clean environment with increased pace of development.

Downstream of the pipeline, at least 25 industrial clusters will be developed in the 5 states of UP, Bihar, Jharkhand, West Bengal and Odisha. This would also mean job creation for the youth. The investments in creating Natural Gas infrastructure in Varanasi is part of the larger plan that the government has for eastern India.

According to IOC, the integrated planning for the region gives confidence for timely completion of Varanasi project. Total investments of Rs 51,000 crore have been planned for Eastern India. This includes Rs 13,000 crore for Jagdishpur-Haldia & Bokaro-Dhamra pipeline; Rs 6,000 crore for Dhamra LNG project; Rs 6,000 crore for city gas distribution network and Rs 26,000 crore for Fertilizer project. All these developments are inter-linked and have to be completed within the deadline to extend the full benefit.

The government had last month committed to provide a viability gap funding of 40 percent to GAIL (India) Ltd to construct the Jagdishpur-Haldia and Bokaro-Dhamra gas pipeline project. The Cabinet Committee on Economic Affairs has already approved grant of around Rs 5,176 crore for the project which has an estimated cost of Rs 12,940 crore.

IOC said switching to gas from oil makes sense as only 1 percent reduction of liquid fuel by gas translates into a reduction of at least $1 billion (around Rs 7,000 crore) per annum. The saving is calculated considering India's current oil import bill based on present consumption levels. Replacing just 1 percent coal currently burned for power would cut carbon emissions at par with increasing renewable power generation by 11 percent.

According to the oil ministry, the switch towards gas would also give a fillip to the goal of achieving 15 percent of gas share in India’s energy consumption. The government plans to increase the share of gas in total energy mix from 6.5 percent currently to 15 percent in near future.